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Review and analysis of the market of nylon upstream raw materials 1) Pure benzene fell slightly, and the general trend continued to consolidate. In January 2008, the crude oil market shot up to US$100/barrel and then fell back. The trend of pure benzene fell to below US$1,000/ton, but the general trend continued to oscillate. In 2007, the pure benzene FOB Korean US dollar market basically ran in the range of 950-1,100 US dollars/ton. The distance between pure benzene and CPL outer disk continues to widen. 2) The CPL external market buying atmosphere in January began to warm up after accumulating in November and December. The quotation for the January contract goods from South Korea was US$2,480/ton L/C for 90 days, and after the transaction was US$2,450/ton, the deadlock between the market and the downstream took over. However, due to foreign holidays and low market positions, the offers were limited at the beginning of the month, and began to slightly increase the downstream takeover intention by the middle of the month. As Eastern Europe returned to the market after the holidays, offers gradually increased. However, the cost of receiving orders in the new cargo market was high. Offers quickly rose to US$2,480-2,500/ton L/C90 days. Ship cargo transactions were mostly below US$2,470/ton, and floating goods and bonded warehouse goods were around US$2,480/ton. In late January, downstream replenishment was gradually completed, but the market was mostly on the sidelines due to high acquisition costs, and the trading atmosphere weakened. Judging from the transaction situation in the spot market, although there was some replenishment before the holiday, tight funds restricted the overall transaction volume. In terms of contract cargo, the offer price in mainland China in January was US$2,470-2,480/ton L/C90 days, and the transaction was US$2,450/ton. ； The contract quotation in Taiwan is US$2,450/ton L/C spot, and the transaction price is US$2,415-2,425/ton L/C spot. Taiwan's spot transactions were weak in January and remained at US$2,410-2,420/ton. 3) CPL RMB spot Although the CPL USD spot rebounded, the RMB spot continued to decline in January, mainly due to comprehensive factors such as tight funding, weakening downstream demand before the holiday, and appreciation of the RMB. CPL downstream funding was still tight in January, while the RMB continued to appreciate against the U.S. dollar, prompting some traders to sell, and imported RMB spot prices fell rapidly, creating a situation where the internal and external market inversion gradually widened. Under the pressure of imported supply, domestic spot shipments have been weak, inventories have increased, and quotations have been gradually reduced. However, despite this, tight funds have strangled purchasing demand. RMB spot trading was not active in January. Except for some traders who placed medium and large orders in the first ten days of the year, most orders have been placed since then. By the end of the month, the market price was at 22,400 yuan/ton, with partial acceptance and slightly higher for small orders. The settlement price of Sinopec in January was 22,400-22,500 yuan/ton, some of which were accepted, and the listing price in February was also at this level. The quotation price of Oriental high-quality products was adjusted to 22,600 yuan/ton. 4) CPL USD spot orders were received. In January, CPL USD spot orders were mainly received in the second and third weeks, but even so, the volume of orders was not very large, and the overall atmosphere was not very active. CPL supply continued to rise in December 2007, of which CPL import volume was 43,000 tons and output was approximately 28,000 tons. ； According to the early spot receipts, the import volume in January is expected to be reduced compared to December, around 39,000-40,000 tons, and the output, based on the device load in January, is around 25,000-26,000 tons. 6) Market Outlook Analysis With pre-holiday stocking basically completed, the focus of the CPL market is on post-holiday market trends. Against the background of tight macro funds, rapid RMB appreciation, and unclear downstream demand, the market has many speculations about the trend of CPL in the first half of the year. We believe that the US dollar can operate at a higher level, while the spot market may be slightly passive. 1. From the perspective of the entire industrial structure, the global expansion rate of nylon polymerization and spinning is significantly higher than the development of raw material CPL. Especially in Asia, production capacity such as polymerization and civilian spinning continued to expand rapidly from 2006 to 2009, including China, Taiwan, Thailand, and Russia. Polymerization production capacity, including Ross's, has been expanded and is under construction to more than 850,000 tons. Most of the expanded production capacity is concentrated in China and Taiwan. Among them, the polymerization production capacity planned to be put into production in mainland China in 2008 is about 200,000 tons. In addition, the expansion of nylon spinning production capacity at this stage is about 600,000 tons. Compared with downstream industries, CPL's capacity expansion in 2008 still lagged behind. If there are no major economic surprises, downstream demand will still support the tight supply of raw materials. 2. The rapid appreciation of the RMB continues to push up the price of the US dollar. Entering 2008, the RMB has appreciated rapidly, and the trend is likely to continue in the first half of the year, which is an important factor in the high level of US dollar spot prices. 3. In terms of cost factors, the initial oil price in 2008 exceeded US$100/barrel, and market participants believed that this opened up greater room for growth. ； However, the same concerns about slowing economic growth in Europe and the United States are also suppressing oil prices. Against this background, pure benzene still maintains a narrow oscillation trend. According to Figure 6, since 2003, as crude oil prices continue to rise, the price of pure benzene has stood at the current level many times. It is difficult to imagine that pure benzene will have a larger downward trend in the medium term, unless crude oil prices fall significantly.